Political parties change tack over controversial matriculation tax

PALMA
THE hugely unpopular and costly yacht matriculation tax could become a political issue in the run up to next year's local elections as all parties, some more than others, appear to have finally become aware of the problem and the significant amount of income the region is losing as a result of the levy.

The first party to publicly come out in support of the local and international nautical industry which wants the 12 percent matriculation tax scrapped, in line with many of Spain's competing charter destinations such as France, Italy and Croatia where taxes are either minimal or non existent, was the Majorcan Unionist Party.

In June, it published a Non-Law Proposal entitled “Energising the nautical sector” which was well received by the marine industry. “Tourism is our country's main economic activity. In all aspects, the marine tourism is one of the highest quality activities and one with the highest potential to generate revenue and job positions. “The Balearic Islands are well-known for their variety of coastal attractions, our high quality port facilities, and the high standards of the nautical companies operating on our islands. But it's also true that there is a general decrease in demand in the marine industry due to the many obstacles, especially a policy that discourages customer demand and has penalising traits in comparison to the same policies of the competing European countries,” the proposal stated in its introduction.

The main obstacle is the matriculation and the Bulletin learnt yesterday, that the opposition Partido Popular is also up to speed of the problem and is currently reviewing the situation.

Scrapping the tax could even become part of its manifesto under tourism and tax for next year's elections.
Because the Balearic President, Francesc Antich, has refused to have a debate over the 2011 budget, both the PP and the UM have been prevented putting the matriculation tax issue before the local parliament, so the PP is apparently considering offering some kind of resolve in its new manifesto.

There also appears to be a certain amount of backing to eradicating the tax within the governing PSOE Socialist Party, although, as nautical industry bosses have been telling the Bulletin this month, much of the current government considers the tax as one for the rich who can afford yachts.

But, as the Bulletin was told yesterday; “this is not a rich man's playground and the region is losing hundreds of millions of euros every year as a result of the tax which is pushing the charter industry away to more competitive destinations like France, Italy and Croatia.” The process of establishing a pan-European, or cross Mediterranean basin tax is also underway in Brussels but the debate, which has been raised by the EU Grupo Popular, will be a long one and legislation may only be introduced in the mid-term. But, while the political debate will rage here, in Madrid and in Brussels, the Balearics will continue to lose revenue and new jobs.

According to the latest figures, the average nautical tourist generates a daily expenditure of about 130 euros, an amount that increases to 450 euros per day in the case of large yachts, and many clients are repeat visitors.